Shell Refining Company (Federation of Malaya) Bhd is looking at a potential sale of assets, or conversion of operations to a storage terminal in a bid to combat poor refining margins.
A filing with Bursa Malaysia stated that the board had completed a structured review of the company’s resilience in the current poor margin environment as announced in September 2014. “The Board has concluded that refining margins are expected to remain depressed due to overcapacity in the global refining industry,” it read. “Given the poor margin environment, the board is proactively investigating long-term options in the best interest of the company.
“These will include, but are not limited to, the potential sale of the assets, or conversion of operations to a storage terminal and/or other viable options. The focus near-term is to secure and sustain the safe and reliable operation of the refinery while long-term options are being pursued.